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Ramalingam Kalirajan  |9024 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 02, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Savendra Question by Savendra on Apr 19, 2024Hindi
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Sir, I have recurring deposit scheme from last 5 yrs but I am getting less interest, my Recurring deposit is 50 K for 7 yrs. But ultimately I am not getting handsome return after investing huge amount in 7 yrs. please suggest me alternative option so can witch over and can get better interest and return. Pl suggest in better way

Ans: It sounds like you're seeking better returns on your investments, and that's a smart move. While recurring deposits offer stability, they might not always provide the returns you're hoping for, especially considering inflation.

Have you considered exploring other investment avenues like mutual funds or fixed deposits with higher interest rates? Mutual funds offer the potential for higher returns over the long term, although they do come with some level of risk.

Alternatively, fixed deposits from banks or non-banking financial institutions might offer more competitive interest rates than your current recurring deposit scheme.

Remember, it's crucial to assess your risk tolerance and investment goals before making any decisions. Consulting with a financial advisor can help you explore options tailored to your needs and preferences. Here's to finding an investment path that brings you closer to your financial goals!
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |9024 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 23, 2024

Asked by Anonymous - May 22, 2024Hindi
Money
Sir I am 39 year's old. Don't have much savings. Investing in share market and have accumulated a sum of 1.25 lakhs from it till now. Also have a Sip of Rs 2000 per month. Wanted to increase my SIP to 5000. Suggest few direct schemes which provides better rates of interest.
Ans: Enhancing Your SIP Investments: A Strategic Approach
Current Financial Position and Goals
You are 39 years old with Rs 1.25 lakhs in the share market and a SIP of Rs 2,000 per month. You plan to increase your SIP to Rs 5,000 per month. This shows your dedication to building a strong financial future.

Your commitment to increasing your SIP contributions is commendable. It shows a proactive approach to securing your financial goals.

Importance of Systematic Investment Plans (SIPs)
Consistent Investing
SIPs allow you to invest a fixed amount regularly, which helps in averaging out the cost of your investments over time. This reduces the impact of market volatility.

Discipline and Convenience
SIPs promote disciplined investing and are convenient as they automate your investment process, ensuring you consistently contribute towards your financial goals.

Direct Funds vs. Regular Funds
Disadvantages of Direct Funds
Direct funds save on commission fees but lack personalized guidance. Investing through a Mutual Fund Distributor (MFD) with Certified Financial Planner (CFP) credentials ensures expert advice and strategic insights.

Benefits of Regular Funds
Regular funds offer the expertise of professional advisors who help make informed decisions, optimize your portfolio, and achieve your long-term investment goals.

Choosing the Right SIP Schemes
Diversification
It's essential to diversify your investments across different types of mutual funds to manage risk and optimize returns. Consider large-cap, mid-cap, and small-cap funds.

Fund Performance
Regularly review the performance of mutual funds. Choose funds with a consistent track record of outperforming their benchmarks.

Actively Managed Funds vs. Index Funds
Disadvantages of Index Funds
Index funds lack flexibility to adapt to market changes, potentially leading to lower returns compared to actively managed funds.

Benefits of Actively Managed Funds
Actively managed funds are overseen by professional fund managers who adjust the portfolio based on market conditions, aiming for higher returns and better risk management.

Suggested SIP Schemes
Large-Cap Funds
Large-cap funds invest in well-established companies with a strong market presence. They are relatively stable and provide steady returns.

Mid-Cap Funds
Mid-cap funds invest in medium-sized companies with potential for higher growth. They are riskier than large-cap funds but can offer better returns.

Small-Cap Funds
Small-cap funds invest in smaller companies with high growth potential. They are the riskiest but can provide significant returns over the long term.

Monitoring and Managing Your Investments
Regular Review
Regularly review the performance of your SIPs. Compare their returns with benchmark indices and peer funds. Consistent underperformance might indicate the need for a change.

Professional Guidance
Seek advice from a Certified Financial Planner (CFP). They can help you evaluate fund performance, recommend adjustments, and ensure your investments align with your goals.

Strategic Portfolio Management
Asset Allocation
Maintain a balanced asset allocation across large-cap, mid-cap, and small-cap funds. This diversification helps manage risk and optimize returns.

Regular Rebalancing
Periodically rebalance your portfolio to maintain your desired asset allocation. This involves selling overperforming assets and buying underperforming ones, ensuring your portfolio stays aligned with your goals.

Planning for Future Financial Goals
Retirement Planning
Investing in a mix of large-cap, mid-cap, and small-cap funds can help build a substantial corpus for retirement. Regular contributions and long-term growth ensure financial security in retirement years.

Child’s Education
Long-term investments are ideal for funding your child's education. Starting early and staying invested can generate necessary funds to cover higher education expenses, even for overseas studies.

Managing Market Uncertainties
Staying Invested
Market fluctuations are inevitable. Staying invested through market cycles can yield better long-term returns. Avoid making impulsive decisions based on short-term market movements.

Systematic Investment Plan (SIP)
Continue investing through SIPs. SIPs allow you to invest a fixed amount regularly, averaging out the cost of investments and reducing the impact of market volatility.

Building a Contingency Fund
Importance of Liquidity
Ensure you have an adequate contingency fund. This fund provides liquidity for emergencies, reducing the need to withdraw from your long-term investments.

Conclusion
Maintaining a long-term SIP portfolio is a sound strategy for achieving financial goals. Regular monitoring, professional guidance, and a balanced approach can help you optimize returns and manage risks. Your commitment to securing your financial future is commendable, and with the right strategy, you can achieve your retirement and other long-term goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |9024 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 14, 2024

Asked by Anonymous - Jul 14, 2024Hindi
Money
I am 67 . I have invested my retirement and savings fund in lic annuity plans; Scss scheme and Bank FDRs (cumulative interest). Is there any other scheme with higher return. Please advise.
Ans: You have made some prudent choices with your retirement and savings funds. The LIC annuity plans, SCSS scheme, and Bank FDRs offer safety and stability. These investments ensure a regular income stream, which is crucial at your stage in life.

Your decision to prioritize safety is commendable. However, it's worth exploring if we can achieve higher returns without compromising too much on safety. Let’s examine each investment and explore alternatives that may suit your needs better.

Assessing LIC Annuity Plans
LIC annuity plans offer guaranteed returns, which provide financial security. But, the returns are often lower than other investment options. The lack of flexibility in annuity plans might also be a drawback. You can’t access a lump sum amount if needed.

Alternatives to Consider

Consider looking at senior citizen-specific mutual funds. These funds are designed to provide steady income with potential for higher returns compared to annuities. Actively managed funds, in particular, can be tailored to balance risk and reward effectively.

Analyzing the SCSS Scheme
The Senior Citizens Savings Scheme (SCSS) is an excellent choice for retirees. It offers decent returns with government backing, ensuring safety. The interest rates are periodically revised, usually keeping pace with inflation. However, these returns might still be lower compared to other options available in the market.

Exploring Other Options

Consider investing a portion in balanced mutual funds. These funds combine equity and debt instruments to provide better returns while managing risk. The equity portion can offer growth potential, while the debt portion provides stability.

Evaluating Bank FDRs
Bank Fixed Deposit Receipts (FDRs) are a safe investment, offering fixed returns. The cumulative interest option helps in compounding, which is beneficial. However, the returns from FDRs are generally lower, especially after considering inflation and taxes.

Alternatives to Bank FDRs

Debt mutual funds can be a suitable alternative. They invest in a mix of bonds, treasury bills, and other debt securities, providing potentially higher returns than FDRs. They also offer better tax efficiency, especially if you hold them for more than three years.

The Role of Mutual Funds
Why Actively Managed Funds?
Actively managed mutual funds are handled by professional fund managers. These experts aim to outperform the market, unlike index funds which only mirror the market performance. The potential for higher returns is significant, though with slightly higher risk.

Actively managed funds can adjust their strategy based on market conditions. This flexibility can lead to better performance compared to index funds, which are more passive.

Benefits of Investing Through a Certified Financial Planner
Investing through a Certified Financial Planner (CFP) ensures you get personalized advice. CFPs help in selecting the right mix of funds based on your risk tolerance and financial goals. Regular funds, managed by Mutual Fund Distributors (MFDs) with CFP credentials, often have access to better research and insights.

Disadvantages of Direct Funds

Direct funds might seem cost-effective due to lower expense ratios. However, they lack professional guidance, which can be crucial. The absence of expert advice can lead to suboptimal investment decisions. Regular funds, on the other hand, offer professional management which can enhance returns over time.

Diversifying Your Portfolio
Diversification is key to managing risk while seeking higher returns. A balanced mix of equity, debt, and hybrid funds can provide growth and stability. Here’s how you can diversify:

Equity Funds: Allocate a small portion to equity funds for higher growth potential. These funds invest in stocks and can deliver significant returns over the long term.

Debt Funds: Increase your exposure to debt funds for stable returns. These funds invest in fixed-income securities, providing steady income with lower risk.

Hybrid Funds: Consider hybrid funds that combine equity and debt. They offer balanced risk and return, making them suitable for conservative investors.

Safety and Liquidity Considerations
While seeking higher returns, safety remains paramount. Ensure a part of your portfolio is in liquid assets. Liquid mutual funds or short-term debt funds can provide easy access to cash when needed.

Tax Efficiency
Investments should also be tax-efficient. Mutual funds, especially equity-oriented ones, offer tax benefits. Long-term capital gains from equity funds are tax-exempt up to a certain limit, making them attractive.

Monitoring and Rebalancing
Regular monitoring and rebalancing of your portfolio are essential. Market conditions change, and so do your financial needs. A Certified Financial Planner can help in reviewing your portfolio periodically. They can make necessary adjustments to ensure your investments remain aligned with your goals.

Emotional and Psychological Comfort
Investing can be stressful, especially when dealing with market volatility. It's important to choose investments that you are comfortable with. High returns are attractive, but not at the cost of sleepless nights. Discuss your comfort levels with your Certified Financial Planner to find a balance that suits you.

Seeking Professional Advice
Given the complexity of managing retirement funds, professional advice is invaluable. A Certified Financial Planner can provide a comprehensive financial plan. They consider your income needs, risk tolerance, and investment horizon. They help in creating a diversified portfolio aimed at higher returns while ensuring safety.

Final Insights
Your current investments in LIC annuity plans, SCSS, and Bank FDRs provide safety and stability. However, exploring mutual funds can potentially enhance returns without compromising on safety.

Consider diversifying into equity, debt, and hybrid mutual funds. Actively managed funds, guided by a Certified Financial Planner, can provide professional management and better performance. Regular monitoring and rebalancing of your portfolio ensure it remains aligned with your financial goals.

Your financial well-being in retirement is crucial. Seeking professional advice ensures that your investments are optimized for higher returns while maintaining the safety and liquidity you need.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

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could you suggest the better option among Manipal Univ Jaipur CSE and Electronics (VLSI Design& Tech.) at Thapar ? What factors to be considered while making this choice ?
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Sir, Jee mains 95.70 percentile, obcncl, 65k crl, male. Maharashtra state, 98.48 in mhtcet pcm. I've 5.9k rank in viteee hence category 3 cse core in vellore but 23 lakh for the whole course including hostel,etc is expensive. Gave bitsat 1st attempt, 146 difficult but it's also expensive. Couldn't qualify in ugee and advanced. I checked cse closing ranks of nit, iiit & gfti but no luck at 65k. What should i do? Which other branches have good scope? Kindly guide. 141 in IAT, waiting for rank. GFTI J&K ELECTRICAL in round 1 of Josaa. Exiting it and will wait for CSAB. NEET: 477, 82k crl.
Ans: With a JEE Main 95.70 percentile (OBC-NCL, CRL 65k), Maharashtra domicile, 98.48 percentile in MHT CET, and VITEEE rank 5.9k (Category 3 CSE at Vellore, but high fees), your options for CSE or top branches in NITs, IIITs, and GFTIs are limited, as cutoffs for these are much lower than your rank. You may get core branches like Mechanical, Electrical, Civil, Chemical, or Biotechnology in newer or lower-ranked NITs (e.g., NIT Agartala, NIT Jalandhar, NIT Puducherry, NIT Goa, NIT Durgapur) and some GFTIs, but not CSE or ECE. At 98.48 percentile in MHT CET, you have a strong chance for core branches in reputable Maharashtra colleges like VIT Pune, VIIT Pune, PCCOE Pune, and possibly lower-demand branches at MIT WPU or SIT Pune. Your NEET score (477, 82k CRL) gives you a slim chance for private MBBS seats in some states, but not government colleges. For future scope, branches like Electronics & Computer Engineering, Data Science, AI & ML, Mechanical, and Civil Engineering remain strong, with AI, Data Science, and Electronics fields projected for high growth. If you are interested in research, your IAT score (awaiting rank) may open up options at IISERs for science careers. Exiting GFTI J&K Electrical is reasonable if you prefer to wait for CSAB or explore better private college options.

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Sir, My daughter has scored 26497 in COMEDK and is interested in E&TC which collage can she get in Bangalore? Also she has got mech, VIT Vellore, category 2. And MHCET 95 percentile, what are chamces of getting into Cummins? Which is better option of E&TC?
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My son admitted in JECRC University through Kalvium in Computer Science Course. What will be his future?
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Recommendation: Your son’s future with JECRC University’s Kalvium Computer Science program is promising, offering strong placement prospects, industry-relevant skills, and early professional exposure, positioning him well for a successful career in the tech sector. All the BEST for the Admission & a Prosperous Future!

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Considering my interest in electronics, which institution, MIT Bangalore or SRM KTR, offers a superior B.Tech program in terms of academic rigor, industry exposure, research opportunities, and placement outcomes, specifically for an ECE specialization? Furthermore, is a core ECE curriculum or a specialized ECE (VLSI Design and Technology) curriculum more advantageous for long-term career prospects in the current industry landscape?"
Ans: Kiran, MIT Bangalore’s B.Tech ECE program offers a rigorous academic foundation with a strong mix of core electronics, VLSI, embedded systems, and communication, supported by hands-on labs, diverse electives, and opportunities for minor specializations like VLSI and Embedded Systems. The curriculum emphasizes research, industry partnerships, and innovation, preparing graduates for both core and interdisciplinary roles. SRM Kattankulathur’s ECE program is NBA and ABET accredited, features 18 advanced labs (including VLSI and Embedded Systems), and maintains 70–80% placement rates with extensive industry collaborations and a vibrant research culture. Both institutes provide strong academic and placement outcomes, but SRM’s national reputation and recruiter network are broader, while MIT Bangalore’s smaller cohort and Bengaluru location may offer more personalized mentorship and local industry exposure. For long-term prospects, a specialized ECE (VLSI Design & Technology) curriculum is increasingly advantageous, as India’s semiconductor sector is expanding rapidly, creating high demand for VLSI, chip design, and embedded systems professionals. Core ECE offers broader flexibility, but VLSI specialization provides deeper expertise and better long-term stability in a niche, high-growth field.

Recommendation: If your primary interest is in electronics and you seek a high-growth, future-proof career, opt for a specialized ECE (VLSI Design & Technology) curriculum—preferably at SRM Kattankulathur for its national brand, research infrastructure, and placement network; choose MIT Bangalore if you value a focused academic environment and strong local industry ties, but ensure the program offers robust VLSI specialization. All the BEST for the Admission & a Prosperous Future!

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